MEDIA RELEASE

Despite a successful marketing campaign that filled Japan Air Lines flights to Kona this spring, JAL executives this week confirmed the airline will suspend its direct Narita-to-Kona flights on October 29.

County of Hawai‘i Mayor Billy Kenoi, the Hawai‘i Tourism Authority and other industry stakeholders responded by announcing a new promotional campaign called “E Komo Mai Kona” to entice visitors from Japan to continue to select Kona as their destination after the direct flights end. The promotional campaign will begin offering its discounted packages November 1 to encourage visitors to travel to Kona via Honolulu.

“We worked hard to convince Japan Air Lines to reconsider its decision to suspend the Kona flights, but we understand the airline is under enormous pressure to restructure,” Mayor Kenoi said. “Centralizing JAL’s Hawai‘i operations in Honolulu is a cost-cutting step that is part of a much larger strategy to deal with a crisis, and our partners at Japan Air Lines felt they had no choice. I understand and respect that decision, which was a difficult choice for the airline to make.”

Mayor Kenoi said Kona will be partly cushioned from the impact of the Japan Air Lines decision by the recent increases in domestic direct-flight seats to Kona. Alaska Airlines, American Airlines and Delta are each adding thousands of seats to Kona this year. Alaska Airlines alone is on course to add more than 55,000 new seats in 2010.

Mike McCartney, president and CEO the Hawai‘i Tourism Authority, said Japan Air Lines has been an excellent partner during the 14 years of direct flights to Kona, and JAL remains a key player in the Hawai‘i visitor industry. McCartney noted that Japan Air Lines cut about 40 percent of its international flights as part of the current restructuring, which is also expected to cut about 16,500 jobs from the airline’s payroll.

“We appreciate the difficult situation Japan Air Lines is in today, but we aren’t giving up,” McCartney said. “All of the stakeholders will be looking for any and all opportunities in the future to encourage JAL to resume direct flights to Kona. We commit to them to do more to try to grow this market, and to create the demand for this market so that resuming direct flights will be something they can consider in the future.”

“We believe Kona is of strategic importance because it is the second international port of entry to Hawai‘i,” McCartney said. “For Hawai‘i’s long-term future, for economic prosperity, having that additional port of arrival on the island of Hawai‘i is important.”

State Tourism Liaison Marsha Wienert praised the contribution Japan Air Lines has made to visitor industry in the County of Hawai‘i, and said the coordinated effort to retain the direct flights to Kona was a model of government and industry cooperation.

“It was so important to everyone, not just to the Big Island but to the state as well, and everyone worked very hard to convince them to continue, but we understand the challenges they are facing,” Wienert said.

The new E Komo Mai Kona program will help stimulate demand and continue to drive business to Kona, McCartney said. E Komo Mai Kona is an aggressive promotional package developed by HTA, the tourism industry including the hotels and tour companies, the county and the Big Island Visitors Bureau. The package will roll out over the next six months.

“We will press ahead with the new E Komo Mai Kona initiative to use incentives and aggressive marketing to encourage Japanese visitors to continue to enjoy all that Kona, Kohala and Hilo have to offer,” said George Applegate, executive director of the Big Island Visitors Bureau.

David Uchiyama, HTA Vice President for Brand Management, said Japan Air Lines recognizes that its load factors increased significantly after the county, state and travel industry in Hawai‘i collaborated on a special promotion effort earlier this year. The load factor for the direct flights to Kona for most of this year improved by 20 to 30 percent over the average load during comparable months from 2003 to 2009.

Tourism industry stakeholders worked with county, state and federal officials, the Hawai‘i Tourism Authority and Big Island Visitors Bureau this year to encourage Japan Air Lines to continue the direct flights to Kona. A timeline with some of the major developments follows:

• March and April — Mayor Billy Kenoi meets with the Hawai‘i delegation and various Big Island visitor industry stakeholders to collectively develop a sustainability plan to help preserve the Narita-Kona flight.
• April 12 — Representatives of Hawai‘i Tourism Authority, Big Island Visitors Bureau, Mayor Kenoi and industry executives join state Tourism Liaison Marsha Wienert and others to develop an incentive package to encourage Japan Air Lines to continue the direct flights. The package includes commitments for financial contributions from Hawai‘i Tourism Authority, the County of Hawai‘i and the hotel industry to help promote Kona to the target market of Japanese travelers.
• April 13 — A delegation including Hawai‘i County Managing Director Bill Takaba, Hawai‘i Tourism Authority President and CEO Mike McCartney, HTA Vice President for Brand Management David Uchiyama, Big Island Visitors Bureau Executive Director George Applegate and others depart for Japan to make the case for continued direct flights to Kona, and to present the incentive package to the new board appointed to oversee the JAL restructuring.
• April 26 — JAL board members fly to Oahu to meet with HTA executives and Mayor Kenoi to confirm that JAL plans to discontinue the direct Narita-Kona flights effective October 2010 as part of JAL’s larger decision to reduce routes and cut 16,500 jobs.
• April 28 — Mayor Billy Kenoi convenes a special meeting between the Hawai‘i Tourism Authority President and CEO Mike McCartney, State Tourism Liaison Marsha Wienert, Big Island Visitors Bureau Executive Director George Applegate and other major stakeholders such as the hotels and tour wholesale companies to pursue a strategy to respond to the flight suspension. At this meeting, HTA and the delegation commit to work with Hawai‘i Island officials and other interested parties to pull together an expanded airlift package that will encourage a carrier to serve Hawai‘i
• May — Big Island Visitors Bureau works with marketing firm Hawai‘i Tourism Japan to assemble a special promotion effort to market Big Island attractions to the Japanese consumer.
• May to present — State Tourism Liaison Marsha Wienert leads an effort to find a replacement airline willing to fill the gap left by the announced suspension of the JAL direct flights to Kona.
• May 9-13 — HTA President and CEO Mike McCartney and Vice President David Uchiyama fly to Japan and Korea to make various sales calls in the region, including meetings with tour operators and JAL to further the conversation.
• May-June — Discussions on ways to preserve the flight produce new ideas for reducing JAL’s costs by millions of dollars per year. Advocates for the Narita-to-Kona flight also note that the load factor for most months from January to July 2010 has increased on the route by 20 to 30 percent over the average for the route for comparable months from 2003 to 2009.
• June 17-18 — Governor Linda Lingle, HTA President and CEO Mike McCartney and Tourism Liaison Marsha Wienert meet with airline representatives and tour operators in Tokyo and discuss the importance of direct flights to Kona
• July 20 — Industry partners in Hawai’i meet to plan a campaign to convince Japan Air Lines to delay the suspension of the Narita-to-Kona route until at least March 2011 based on the 20 to 30 percent increase in load factor for most of the first and second quarters of 2010 over historic levels.
• July 24 — HTA Vice President David Uchiyama and Big Island Visitors Bureau Executive Director George Applegate travel to Japan to present the proposal to the JAL board, and are told the board will consider the issue.
• July 26 — United States Senate Appropriations Committee Chairman Daniel K. Inouye writes on behalf of Mayor Kenoi and the Hawai‘i Tourism Authority to Mr. Seiji Maehara, Japan’s Minister of Land, Infrastructure, Transport & Tourism. Senator Inouye asks Minister Maehara to continue to explore options for continuing the Narita-to-Kona flights, noting the significant increase this year in load factor for the route.
• August 18 — Mayor Kenoi meets with Japan Air Lines executives in Tokyo to stress the importance of the Narita-to-Kona route and the potential for revenue growth given the dramatic 2010 increase in load factor. The meetings included four of the top executives involved in strategic planning and restructuring for JAL. They are: Shigemi Kurusu, Japan Air Lines’ executive officer and general manager, Corporate Planning Division; Takeshi Morita, manager of Corporate Planning; Tetsuya Onuki, vice president of Corporate Planning; and Masaharu Nakashima, director, Strategic Corporate Relations.